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Economic Growth and Environment Nexus: The Role of Foreign Direct Investment

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  • Mesagan, Ekundayo

Abstract

This study focused on the role foreign direct investment plays in the relationship between quality environment and economic growth in Nigeria from 1970 to 2013. The ordinary least squares technique was employed and the key variables include carbon emission, human capital, per capita income, FDI, trade openness, interest rate, inflation rate and the interaction term between environment and FDI. The result showed that all the variables are stationary at first difference and that long run relationship exists among them. It is observed that FDI ratio and environment negatively impact GDP over the period, but the interaction between FDI and environment positively impact economic growth. It is recommended that the country should reform its environmental policies to attract proper and appropriate technology to boost its economic progress as suggested by the interaction term in the model.

Suggested Citation

  • Mesagan, Ekundayo, 2015. "Economic Growth and Environment Nexus: The Role of Foreign Direct Investment," MPRA Paper 76722, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:76722
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    References listed on IDEAS

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    Cited by:

    1. Mesagan, Ekundayo Peter & Alimi, Olorunfemi Yasiru & Vo, Xuan Vinh, 2022. "The asymmetric effects of exchange rate on trade balance and output growth," The Journal of Economic Asymmetries, Elsevier, vol. 26(C).
    2. Salaudeen Mohammed Bashir, 2023. "Effect of Crude Oil Revenue on the Oil and Non-oil Sectors in Nigeria," Acta Universitatis Sapientiae, Economics and Business, Sciendo, vol. 11(1), pages 138-161, October.
    3. Nisar Ahmad & Angeliki N. Menegaki & Saeed Al‐Muharrami, 2020. "Systematic Literature Review Of Tourism Growth Nexus: An Overview Of The Literature And A Content Analysis Of 100 Most Influential Papers," Journal of Economic Surveys, Wiley Blackwell, vol. 34(5), pages 1068-1110, December.
    4. Wei-Bin Zhang, 2018. "Health, Environment, and Wealth," Izvestia Journal of the Union of Scientists - Varna. Economic Sciences Series, Union of Scientists - Varna, Economic Sciences Section, vol. 7(3), pages 109-123, December.
    5. Ekundayo Peter Mesagan, 2022. "Environmental Sustainability in Sub-Saharan Africa: the Case of Production and Consumption Activities," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 13(4), pages 2840-2867, December.
    6. Anne C. Maduka & Stephen O. Ogwu & Chukwunonso S. Ekesiobi, 2022. "Assessing the Moderating Effect of Institutional Quality on Economic Growth - Carbon Emission Nexus in Nigeria," Working Papers of the African Governance and Development Institute. 22/023, African Governance and Development Institute..
    7. Ekundayo P. Mesagan & Wakeel A. Isola & Kazeem B. Ajide, 2019. "The capital investment channel of environmental improvement: evidence from BRICS," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 21(4), pages 1561-1582, August.

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    More about this item

    Keywords

    Environment; Economic Growth; Foreign Direct Investment; Nigeria.;
    All these keywords.

    JEL classification:

    • F18 - International Economics - - Trade - - - Trade and Environment
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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